IPO in the US? Nick Nash says you’ll need $2b valuation

Despite having an IPO drought over the last two years, Southeast Asia’s capital markets are “wide open right now,” said Nick Nash, managing partner of Asia Partners.

However, the bar for companies – in terms of size and scale – to crack open that market has gotten higher.

The challenge now is that going public in the US typically requires a valuation of around US$2 billion, a significant jump from the previous minimum market cap of US$500 million or less, Nash mentioned while speaking at this year’s Tech in Asia Conference in Jakarta.

Nick Nash, managing partner of Asia Partners, at the Tech in Asia Conference in Jakarta / Photo credit: Tech in Asia

Still, while some believe this figure is closer to US$5 billion for high-profile tech IPOs, Nash said it’s “not as bad as people think.”

He anticipates that Southeast Asia could see up to 15 – or “maybe even a few more” – tech IPOs by 2029, which signals confidence in the region’s growth trajectory.

Breaking the IPO dry spell

This new projection exceeds Asia Partners’ 2019 forecast, which was that by the end of this decade, there will have been 10 tech companies from the region that would have gone public anywhere in the world with at least a US$1 billion valuation.

According to Nash, the region has already seen seven tech IPOs, with most of them happening between 2020 and 2022.

Nash, who previously led Southeast Asian tech giant Sea Group for its listing on the New York Stock Exchange, also explained that there have been no major IPOs of a massive scale in 2023 and 2024.

While 2021 was a big year for tech IPOs globally, with over 100 companies going public, Nash said this group has been “pretty much a disaster.” He noted that 70% of these newly public companies resulted in losses for IPO investors within the first year.

Companies such as business process outsourcing firm TDCX and Bukalapak were some of the players that went public from Southeast Asia in 2021. TDCX has since delisted in a deal valuing the Singapore-based firm at just over US$1 billion.

Such a downward trend on a global basis “leaves a sour taste in peoples’ mouths for a couple of years,” Nash said.

Photo credit: TDCX

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